ACIL Presents Submission to Government Inquiry, Proposing Standard Definition Enhancements in Insurance Sector

The Australian Consumers Insurance Lobby is delighted to present its submission to the Federal Government Inquiry on Standard Definitions and Standard Cover for Insurance. This submission is a critical step towards fostering a fairer and more transparent insurance market.

At the heart of our proposal is a call for fundamental reforms that prioritise consumer interests and address longstanding challenges such as underinsurance and policy complexity. Our submission highlights the urgent need for action to mitigate the detrimental effects of consumer confusion with insurance policies and underinsurance.

Key highlights of our proposal include:

• Consumer-Centric Principles: We emphasise the importance of focusing on overarching principles rather than intricate definitions to offer greater clarity to consumers. By prioritizing consumer interests, insurers can provide more transparent and equitable coverage options.

• Standardization for Clarity: We advocate for the standardisation of insurance policy terms and definitions to eliminate ambiguity and ensure consistency across policies. This will empower consumers with greater clarity and understanding of their coverage.

• Enhanced Transparency: Insurers should be obligated to provide consumers with fact sheets containing information on commonly declined claims and disputed issues. This transparency will empower consumers with crucial insights into potential claim denials and disputes.

• Proactive Approach to Underinsurance: Insurers must take a proactive role in addressing underinsurance by taking action to ensure adequate coverage levels or, at the very least, notifying consumers of potential underinsurance at policy inception.

• Educational Initiatives: We advocate for educational initiatives to improve consumer understanding of insurance policies and coverage options. Empowering consumers with knowledge will enable them to make more informed decisions about their insurance needs.

ACIL urges policymakers, industry stakeholders, and consumer advocates to support these vital reforms to create a fairer and more consumer-centric insurance market. Together, we can ensure that insurance policies are designed to protect consumers and provide them with the security and peace of mind they deserve.

ACIL Submission Standard Definitions and Standard Cover For Insurance (Final).pdf

Download PDF • 718KB

ACIL Releases Comprehensive Report Following Nationwide Survey on Strata Insurance Practices

The Australian Consumers Insurance Lobby Inc (ACIL) is pleased to announce the publication of a significant report following its Nationwide Survey on Questionable Practices in Strata Insurance initiated on 20th March 2024. This detailed report compiles insights from a broad spectrum of responses into a clear summary, pinpointing major concerns and outlining ACIL's path forward for advocacy and reform in the strata insurance industries.

ACIL Chair Tyrone Shandiman commented on the survey's success, stating “ACIL is delighted by the strong response to our Strata Insurance survey, with 87 participants exceeding our expectations. This high level of engagement, especially from those within the industry, signals a commendable readiness to confront and rectify the issues plaguing the strata insurance sector. It's particularly encouraging to see significant input from industry insiders, with some of the most revealing insights coming from these individuals, including an anonymous tip-off that brought to light the questionable practices of a previous employer. "

Key Report Findings:

• New Revelations: The survey revealed additional concerns, including supply chain ownership conflicts and identified bad actors—five strata managers and five insurance brokers—now under ACIL’s investigation, likely leading to further referrals to ASIC & ACCC.

• Regulatory Confusion: There's evident confusion among participants about which body properly regulates the industry, underscoring the need for clarity on governance and oversight.

• Challenges in the Competitive Landscape: Findings indicate a troubling industry environment where ethical conduct is often penalised, and questionable and unlawful practices are incentivised, pointing to a systemic issue that goes beyond individual bad actors.

• Criticism of the SCA: There is a notable dissatisfaction with the SCA, with some survey respondents calling for significant reforms or even the organisation's complete overhaul, reflecting broader discontent with current industry standards.

• Broader Industry Concerns: The survey underscores that the issues extend well beyond strata insurance alone, advocating for a more extensive examination of the strata management industry to address a wider range of consumer concerns.

• Advocacy for Government Inquiry: ACIL emphasises the urgent need for a government-led inquiry to provide clear guidance on disputed practices. Such an initiative is deemed essential for enabling strata managers to operate with greater confidence and for empowering consumers to make well-informed decisions.

The findings from this survey paint a concerning picture of the questionable practices and systemic challenges faced by the industry, advocating for improved transparency, accountability, professionalism and ethical practices, placing consumer interests at the forefront of all decisions.

With the release of this report, ACIL seeks to drive substantial reform, aiming for an industry that upholds the highest standards of integrity and fairness. The document not only highlights the need for change but also proposes a roadmap for ACIL’s continued efforts to safeguard consumer rights and interests nationwide.

ACIL Report - Strata Voices Heard (Final).pdf

Download PDF • 944KB

Addressing Allegations and Reinforcing Commitment: ACIL's Response to Conflict Concerns

In the wake of ACIL's advocacy against certain practices in strata insurance commissions, we have received feedback from media sources and also via associates of ACIL board members indicating that concerns have been raised by unnamed industry bodies. These concerns suggest that board members may be leveraging their positions to further personal business interests, specifically pointing to Strata Insurance Solutions—a company wholly owned by Mr. Shandiman, who serves as its Managing Director, and employs Ms. Eva Jones, ACIL Secretary, as the Operations Manager.

Upon thorough examination, the board has taken these concerns seriously and has come to the following determinations:

• It has been recognised that a conflict of interest exists.

• No substantive information has been directly provided to ACIL to address these concerns.

• The board have determined that there is no evidence suggesting Mr. Shandiman and Ms. Jones have improperly utilised ACIL for the benefit of Strata Insurance Solutions or their personal interests.

• The board has considered whether these allegations are strategically aimed at undermining our advocacy efforts and diverting attention from the critical issues at hand.

• The continued involvement of Mr. Shandiman and Ms. Jones with their extensive knowledge in the issues ACIL are lobbying for (including Strata Insurance Practices) is deemed beneficial to ACIL and the consumers we represent, given their expertise, experience, and the significant contributions they make towards our advocacy efforts.

• The actions of both Mr. Shandiman and Ms. Jones have consistently prioritised consumer interests, reflecting a commitment to ACIL's advocacy goals.

• In response to the allegations, ACIL has ratified a conflict of interest policy, now available on our website (click here), underscoring our dedication to transparent and consumer-focused advocacy.

• The ACIL board will continue to diligently oversee compliance with our Conflict of Interest policy, ensuring our actions remain in alignment with our organisational values and consumer advocacy. 

• We encourage individuals with concerns to address them directly to our board, in accordance with the processes outlined in our Conflict of Interest policy.

Statement from ACIL Chairperson Tyrone Shandiman: In my 13 years at Strata Insurance Solutions, I have been continually surprised by the extent of misconduct in this industry. The issues that have come to light are ones I've long anticipated, finally exposing what has been the industry's white elephant: a problem widely recognised yet consistently ignored, not confined to specific businesses but indicative of a broader, persistent issue.  I acknowledge perceived conflicts of interest between my work at ACIL and my business Strata Insurance Solutions. I ask anyone to consider the merit of these issues when they are raised.  Strata Insurance Solutions operates on a model of low remuneration.  Advocating for a ban on financial payments to strata managers changes the competitive environment in our industry and has the potential to diminish our company’s competitive edge.  When considering my involvement in lobbying for this issue, I concluded that prioritising integrity in our industry is more important than my personal financial gain. Staying silent for profit was never an option. My advocacy on this issue is driven by principle and values, not financial reward.  My prominent stance on this issue also subjects me and my business to heightened scrutiny and potential for strata managers enticing their buildings to competitors driven by solely by retaliatory motives. The issues emerging are real consumer concerns.  Despite the personal challenges involved in advocating for this cause, I am proud to contribute my experience and knowledge in support of ACIL and the consumers we serve. I am fully committed to prioritising the interests of ACIL and its consumers above all else.

This statement was approved by the ACIL board on 16th April 2024.